According to Fannie Mae, for loans other than high-LTV refinances with application dates on or after Jan, 16, borrowers must have reserves equal to whichever is greater:

-Two months of documented reserves or
For loan case files underwritten through Desktop Underwriter (DU), the amount of reserved required by DU with overlays as required by the GSE’s Selling Guide, or for manually underwritten loans, the amount of reserves required per the Eligibility Matrix and Selling guide.

What does that mean?  If you just saved up for a home with the right amount of money, you’ll need more.  Basically, you’ll need to prove (but not pay) two months of mortgage payments as reserves.

How to solve this problem? If you have a retirement fund, that will count towards your reserve, you can get a gift form relatives or you can sell something and put the money in the bank as long as you can prove it.

Annoying?  Yes.  But, Fannie has the money for the best rates and we are at their discretion.  I am sure Freddie mac will follow but FHA, VA and USDA won’t.  Talk to us and we can find your solution!